Nfld. & Labrador·Eye on Iceland

Hand cream to luxury leather: Incubating ideas on how to use fish parts

It's not just the fillets that haul in the cash. Politicians and others from N.L. learn how an Icelandic centre is giving new meaning to secondary processing.

Iceland's Ocean Cluster House brings entrepreneurs together with investors

Thor Sigfusson, director of the Ocean Cluster House in Reykjavik, sits in front of a light fixture made from whole, dried codfish. (Jane Adey/CBC)

In Reykjavik's harbour, overlooking the colourful fishing vessels, there's a building full of bright, young entrepreneurs. While they may never set foot in a boat, haul a net or set a hook, with their social media, marketing and design skills they're determined to maximize value from the seafood industry.

They're members of Iceland's Ocean Cluster House, an innovation incubator for startup companies looking for the best new business idea from fish oil, bones, intestines and skin, or whatever else the ocean provides. 

It's the brainchild of Thor Sigfusson, who's eager to show the space to a group visiting from Newfoundland and Labrador.

"Let me just walk with you through the house, now." 

Ocean Cluster House sits on the harbourfront in Reykjavik. (Jane Adey/CBC)

The tour starts at the Ocean Cluster's public restaurant, Bergsson, where pillows are made from old boat sails and pendant lights are cleverly fashioned from old buoys. Everywhere you look there are reminders of the ocean.

What can we learn?

Iceland's fishing and marine innovation industries are thriving. In September, a group of harvesters, processors, researchers and government officials from N.L. travelled there to see what can be learned.  Jane Adey, host of The Broadcast, made the trip too and has developed a series called Eye on Iceland. 

"We love to have designers involved with what we are doing here," says Sigfusson, who holds a PhD in business.

While working on that degree, he found that fishing companies with money to invest weren't well connected with entrepreneurs in the marine field. So, in 2011, he brought them all together under one roof.

It's a place where entrepreneurs pitch ideas. Supporters provide advice and funding. The matchmaking has spawned about 100 new companies in Iceland.

Taking notes

The visitors from Newfoundland and Labrador are here to take notes on the successful experiment. The minister of fisheries and his assistant deputy are here, as well as a group from Memorial University's Fisheries and Marine Institute.

The groundfish fishery on the east coast is re-emerging and they want to see first-hand how Iceland is creating more value from its fish.

The restaurant at Ocean Cluster House features lights made from recycled fishing buoys and pillows covered with old boat sails. (Jane Adey/CBC)

As the group starts down a hallway of offices, Sigfusson tells the story of a business called Droppi, which makes cod liver oil.

"Droppi is what we can call extra virgin fish oil supplement. What I like is that it is twice the price of other oils, even three times but it's something that the market is interested in so they've been selling quite well in the U.S.," says Sigfusson.

"I know the cod is coming back to Newfoundland so this is all an opportunity for you guys."

Business incubation hubs aren't entirely new to Newfoundland and Labrador — there's Memorial University's Genesis Centre and Holyrood's BeachHead, both spaces for tech startups. But the seafood industry hasn't been part of the startup field to any large degree.

In Iceland, the Ocean Cluster House is having great success. Every year, about 2,000 foreigners come to tour the house to find out how the small island is building its economy with its ocean resources.

Cosmetics, fashion, snacks

Sigfusson holds up a gel product for the curious Canadians to see. It's made from enzymes in the intestines of fish. "This has shown quite good results in terms of the skin," he explains.

The idea came from a researcher who realized the hands of his fishermen nephews were always soft and supple.

"He said how come you can have these soft hands after being in this bad weather in Iceland, fishing all these years? All research has indicated that these enzymes from the fish have such qualities that they can heal skin and be good for joints."

Clockwise from upper left: a shirt made of salmon skin, skin-care products, a vacuum-packed cod head and tinned cod liver pâté and snacks. (Jane Adey/CBC)

Thor Sigfusson guides the visitors into a common room where a wall proudly displays achievements of some of the country's inventors, such as Matthias Gudmundsson, a master machinist who developed technology for the fishing industry.

We have to rely on doing as well with this resource as possible … we have to treat it like a luxury good.- Thor Sigfusson

He draws the group's attention to a table filled with products made from what might be considered waste in other places.

"What is a bit annoying for us Icelanders is that we're mostly hearing that fisheries around the world need more fish to catch but they are still throwing back 55 to 60 per cent of the fish into the ocean or a landfill and we're actually saying you can do more with less."

Companies in Iceland have been particularly inventive with fish skin, making everything from fish leather clothing and accessories to implants used in the medical field to heal wounds.

"What I like is that these guys are actually telling the fisheries that are still skeptical about full utilization, just bring me the skin and throw the rest away," jokes Sigfusson.

A wall at Ocean Cluster House pays homage to innovaters in the Icelandic seafood industry. (Jane Adey/CBC)

He points to some small, ornate boxes made by a company called Reykjavik Foods — another opportunity.

"They're canning Icelandic salmon and by doing that we can bring jobs back to Iceland," he said. "Canning is, of course, something that I know has been huge in your area in the past and I believe it's coming back because this is one of the purest products that you can get."

Fighting the 'good enough syndrome'

As they continue their tour, the Fisheries minister asks how companies get going in Iceland. 

"The strength has been government grants to small startups and for research that has laid the ground for many of these companies," says Sigfusson.

What he tells them next gives the visitors great hope.

"Many of these companies have actually started outside of Reykjavik in small villages … so it shows that Newfoundland is also a place where we might have something like this going if the entrepreneurial spirit is there."

Lighting the fire of innovation isn't always easy. Sigfusson suggests what's most important is the right mindset.  

"[The industry needs] someone saying what I want is really to see my industry develop further," he says. 

"It's coming with a new generation but there are still areas where they are saying to our tech guys, 'What I have is good enough.' … this good-enough syndrome is very deep in seafood," says Sigfusson.

This product sells for two and three times what a typical fish oil would go for. Treating what could be fish waste as a luxury is part of the marketing strategy. (Jane Adey/CBC)

He insists the mindset is different in Iceland.

"I don't know why that is, one reason might be that we do not have that many resources and we have to rely on doing as well with this resource as possible ... we have to treat it like a luxury good."

Sigfusson brings the now-inspired group back to the entrance where they began the tour. Before sending them on their way he admits good ideas in this industry are sometimes hard to sell.

"People said to me in the beginning, 'Thor, I know the industry. You will find 10 companies that need space and that's it.'"

Dozens of successful companies later he's laughing at the naysayers. Sigufsson has helped set up Ocean Clusters in Portland, Maine, and in New Bedford, Mass. He thinks the timing might be right for Newfoundland and Labrador to have an Ocean Cluster too.

"Just build it, and people will come because there are so many ideas out there."